The Paypers: Monetisation of Digital Business Models. Insights into Billing and Recurring Payments

Exclusive Interview with Marko Fliege, Founder and CEO of JustOn, on Best Practices and Pitfalls in Billing and Invoice Management.

About Marko Fliege: Marko Fliege, CEO at JustOn, has over 20 years of experience in developing and marketing of software solutions for e-commerce and e-invoicing. The graduate industrial engineer founded the company with the vision of an easy-to-use business software that automatesand simplifies billing and invoice management processes.

What were the main drivers and motivations behind starting your company, what are your customers' profiles and what issues in their experience are you striving to solve?

JustOn started almost 10 years ago, with the main motivation to provide great backend software as a cloud service. Since I have a background in ERP software and e-commerce, I worked with on-premise software, which was the standard at that time.The goal was to remove some of the old, slow ERP processes and bring it closer to the customers. As a result of that vision, we came up with billing software because it was a niche in themarket. After having researched different cloud platforms wherewe could develop this software on, we decided in favour of the Salesforce Platform.

Our typical customers are small and medium-sized businesseswith recurring revenue and the need to build contracts with usage data. Moreover, most of our customers have international needs,as they transact cross-border, and the software helps from the beginning to serve internationally trading clients.

What are the key challenges for companies that are looking for the monetisation of their digital services?

Tax is a real issue, at least for our clients that act globally. VAT in Europe is relatively easy, but if you sell into the US, there you face a complex tax system, which we integrate via a partnership with Avalara.

Another challenge is regulation, caused by newly introduced invoicing standards. In 2019, Italy introduced a law specifying that, from now on, all companies have to send real e-invoices to the tax authority. E-invoicing processes are different from countryto country, sometimes you need to use the invoice number that the tax authority provided, sometimes you send the invoice to the client after the approval or the tax authority itself. A similar law has been introduced in Germany and will be implemented stepby step, which complicates global activities due to the differentapproaches. For enterprises with international clients it could mean that they need to send invoices to different servers, indifferent formats to support various e-invoicing processes.

Another challenge is relevant for companies that sell based on contracts, with recurring revenue business models: Revenue recognition, meaning that when sending an invoice for a yearly contract (either in advance or at the end of the contract period) the revenue has to be recognised on a monthly basis in order to be compliant.

With an experience of over 150 automated billing software implementations, what best practices as well as pitfalls could you share with us?

Small and medium-sized businesses expect agile, real-time, andfast implementation methods. That is what we've learned from our over 150 projects. We put this experience together into animplementation method that we call X4C: Exploration, Clarification, Configuration, Connect, and Close. For our project staff and our customers, it clarifies how we implement our billing and invoice management system, and it supports us in getting the system to work in just a few days.

We have also learned that a best practice is to follow the experts. All software projects should work with an expert on the subject matter, in billing in particular, because there is a need for cross-functional expertise, starting with insights on contract management and pricing models as well as accounting issues. In addition, when we go into a project, we often start at the end ofthe process chain, asking our customers what it is that they wantto get out of their system, which reports they need. That gives us insights into the real needs of the customer.

Lastly, do not underestimate the mess of your data: sometimesour clients discover the poor data quality only when the invoice isvisible on a PDF. Surprisingly, the invoice is where you really see what data is missing.

Could you elaborate on the changing needs of companies monetising digital services?

Billing usage data is definitely the new standard. Over the last few years, we have seen a shift to the subscription economy. Everybody starts testing how they can sell services based onsubscriptions. However, flat fee subscriptions are not sufficientanymore – you need more pricing models. Clients want to use consumption data and use such data to introduce new pricingmodels. Nowadays, the CFO works closely together with salesoperations to turn the ideas of the sales department into real revenue.

At the same time, automatic payments become highly important. From a process perspective, there is billing and the invoice creation process: Once the invoice is created and sent to the customer, the next issue is payment. Clients expect that the billing and invoice management system is tightly integrated with paymentsystems and offers ways to pay automatically for the service.

How do you see the electronic billing industry changing in the next two years?

Billing and invoice management are no longer back office tasks,provided by the accounting department. Billing, combined with payment, becomes part of the customer experience. That is why a good invoice and payment experience is crucial to a good customer experience.

Secondly, regulation will change the way we think about andhandle billing and invoice management. Lastly, with the increasingactivity in cross-border trade, we are likely to see more in cross-border payments. In matters of payments, in Europe SEPA Direct Debit may become the favourite payment method for SMBs, because – at least in Germany – it is still more accepted than credit card payments.

About JustOn: Since 2010 JustOn stands for successful, cloud-based automation of billing and invoicing processes. With our innovative software JustOn Billing & Invoice Management we are a leading provider on the Salesforce Platform and support companies to realise their digitisation strategy. With JustOn SMBs worldwide monetise every business model directly.